Time Warner Q4 Up, Filmed Entertainment Down31 Jan, 2007 By: Erik Gruenwedel
The lack of a comparatively strong global box office apparently affected the bottom line, as Time Warner Inc. filmed-entertainment revenue declined 15% for the fourth quarter (ended Dec. 31) and 11% for the fiscal year, compared to the same period last year.
Quarterly revenue for the filmed entertainment segment, which includes Warner Home Video, New Line Home Entertainment and HBO Video, was $3.1 billion, down $531 million from last year. For the year, revenue fell $1.3 billion to $10.6 billion.
Operating income for the quarter fell almost 48% to $155 million, compared to $296 million last year.
Principle home video drivers in 2006 included Harry Potter and the Goblet of Fire, Superman Returns and New Line's Wedding Crashers.
Time Warner does not report home entertainment revenue separately.
Theatrically, Superman Returns, The Departed and Happy Feet have generated global box office revenues of $391 million, $264 million and $355, respectively, through Jan. 28, according to company reports.
In 2005, Warner Bros. had four movies top $200 million each in domestic theatrical box office, including Goblet of Fire ($290 million), Wedding Crashers ($209 million), Charlie and the Chocolate Factory ($206 million) and Batman Begins ($205 million).
In a call with investors, company executives lauded the studio's combined 27 Oscar nominations and dismissed the revenue downturn in filmed entertainment as largely cyclical in nature due to “difficult comparisons” with last year's theatrical releases and “higher theatrical valuation adjustments.”
TW fiscal year revenue increased 4% to $44.2 billion; spurred in part by a 58% increase in cable service revenue (to $3.6 billion) and 10.3% rise in network (cable and TV) revenue ($2.6 billion). Quarterly revenue increased 8% to $12.5 billion compared to $11.5 billion last year.